The Philippines will have to mobilize close to P11 trillion in public and private investment over the next two decades to meet its clean energy transition goals, the International Monetary Fund (IMF) said in a new report, while warning that structural bottlenecks could slow progress.  

In an assessment of the country’s renewable energy (RE) transition, the IMF said investment requirements for RE projects are set to rise sharply between 2023 and 2050 under all scenarios in the Philippine Energy Plan 2023–2050. Under a “clean energy scenario” that assumes offshore wind, nuclear power and more efficient new plants, investment needs from 2029 to 2050 are estimated at P7.39 trillion, or about 28 percent of 2024 GDP. A more ambitious scenario that pushes offshore wind capacity from 19 gigawatts to 50 GW and raises the RE share above 50 percent would require P10.67 trillion, roughly 40 percent of 2024 GDP.  

The IMF noted that achieving the authorities’ projected P10.7-trillion total investment requirement from 2029 to 2050 alone would mean spending about 2 percent of 2024 GDP per year on the transition. The government’s stated goal is to raise the share of renewables to 50 percent of the power mix by 2050, a shift it sees as critical not just for climate commitments but also for energy security and the balance of payments, given the country’s heavy reliance on imported fossil fuels. In 2022, fuel imports accounted for around 6.1 percent of GDP and just over half of total primary energy supply, a dependence that could rise further without policy change.  

Despite “abundant” solar, wind, hydro and geothermal potential, installed RE capacity remains relatively low at about 9.5 GW as of 2024, even as demand for electricity is projected to more than quadruple by mid-century. The IMF credited recent reforms—such as allowing 100 percent foreign ownership in certain RE projects, the Energy Virtual One-Stop Shop (EVOSS), and “green lane” incentives—with boosting investor interest, but said they are not yet enough to close the gap.  

The fund warned that several structural constraints still weigh on project delivery and investor confidence, including limited transmission grid capacity, delays in land acquisition, high upfront capital costs and a shortage of skilled workers in the RE sector. Addressing these bottlenecks quickly, it said, will be essential if the Philippines is to convert its policy targets and technical potential into actual projects on the ground, and to make the scale of spending implied by the energy plan sustainable over time.  

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